CHANGES IN TAX LAWS - CRC TAX OUTLINE

TAX OUTLINE

TAX DESCRIPTIONS

Utility Tax
Changes in Michigan Tax Laws, 1997 Through June 2007
		Property Taxes
2000	PA 341:	Amends Public Act 282 of 1905 to allow a company that owned, leased, ran or operated "qualified rolling stock" to claim a tax credit equal to 25% of the expenses incurred in the state in the preceding calendar year. Under the bill, "qualified rolling stock" includes freight, stock, refrigerator, or other railcars that are not the exclusive property of a railroad company.
2002	PA 610:	Provides that the true cash value of property of telephone and telegraph companies is to be determined in the same manner as property assessed under the General Property Tax Act.
Estate Tax
1998	PA 277:	Redefines "internal revenue code" as the Internal Revenue Code in effect on January 1, 1998, or, at the option of the decedent's personal representative, the code in effect on the date of the decedent's death.
State Real Estate Transfer Tax
2000	PA 203:	Exempts Exempts property transferred from one religious institution to another religious institution.
State Education Tax
2001	PA 7:	Provides a credit to taxpayers in the Saginaw City School District to offset $900,000 collected in excess of the amount needed to retire a school district bond issue.
2002	PA 243:	Requires that the tax be collected in a summer levy for 2003 and subsequent years. For 2003 only, the tax rate is reduced from 6 mills to 5 mills.
	PA 244:	Prohibits a city or township levying property taxes in December 2002 from increasing the proportion of its mills levied in the summer 2003.
2007	PA 38:	Exempts industrial personal property.
General Property Tax
1997	PA 138:	For 1997 only, taxes approved by the electors on or before November 30, 1997, were certified for the calendar year.
	PA 202:	For downtown development authorities, expands the definition of "other protected obligation" and allows the State Tax Commission to require reimbursement calculations to be made using a 12-month debt period.
1998	PA 18:	Makes an exception to the requirement that personal property be in a renaissance zone at least 50% of the preceding tax year in order to be exempt from the tax.
	PA 244:	The act amended Public Act 189 of 1953 (which provides for taxation of lessees or users of tax-exempt property) to exclude a casino from the tax exemption allowed under that act for real property located in a renaissance zone.
	PA 280:	Exempts from the tax, after 1997, partially completed new construction if the completed construction will be exempt when put to use; and exempts for tax years 1992 through 1997 partially completed construction, if certain conditions are met.
	PA 328:	Allows the governing body of an eligible local assessing district (a city, village, or township that contains an eligible distressed area) to adopt a resolution to exempt from personal property taxes all new personal property of an eligible business located in an eligible district or districts designated in the resolution.
	PA 373:	Amends the Metropolitan Council Act to provide for the creation of a new kind of organization, a metropolitan arts council, that may levy up to one-half of one mill (with voter approval) to support arts institutions and programs.
	PA 373:	Amends the Metropolitan Council Act to create a metropolitan region council to develop or enhance regional cultural institutions and local recreation and cultural facilities not primarily designed or used for professional sports. Allows a council to levy up to 0.5 mill (with voter approval).
	PA 435:	For petition with the circuit court to strike from the tax rolls uncollectible taxes on personal property, revises filing date and permits joint petitions.
	PA 462:	Grants powers to county boards of commissioners, to make a number of changes with regard to soil conservation districts, including renaming such entities as "conservation districts," and authorizing counties to levy taxes to fund conservation districts.
	PA 468:	Provides an exemption from the general property tax, beginning December 30, 1998, until December 30, 2018, for personal property located in an area designated as a rural enterprise community as of January 4, 1999, under Title XIII of the Omnibus Budget Reconciliation Act of 1993, that is a component part of a natural gas distribution system.
	PA 469:	Requires the state to pay property tax on disabled persons housing owned and operated by a nonprofit corporation or association, by the state, or by an instrumentality of the state, and financed under section 811 of the National Housing Act.
	PA 471:	Exempts from the personal property tax bottled water coolers available for lease or subject to an existing lease.
	PA 498:	Specifies that personal property located in a renaissance zone on tax day and located in the zone for less than 50% of the immediately preceding year is eligible for an exemption from the property tax if the owner of the property files an affidavit that the property will be located in the zone for at least 50% of the tax year for which the exemption is claimed.
	PA 536:	Provides an exemption for property owned and occupied by a charitable trust, while occupied by that charitable trust solely for the charitable purposes for which the trust was established.
	PA 537:	Specifies that certain daily rental property must be assessed to the owner at the location of the rental business, instead of at the location of the rental property, under certain conditions; and continues the tax treatment of certain qualified personal property that is obtained for use or possession for a noncancellable term of 12 months or more (which previously applied only to assessments made before 2000).
1999	PA 20:	Expands the definition, contained in PA 328 of 1998, of personal property eligible for exemption by permitting exemption from taxation of certain new personal property in eligible assessing districts.
	PA 38:	Requires that local units round millage rates down to four decimal places.
	PA 123:	Revises the General Property Tax Act by shortening the period required before a tax delinquent property is subject to forfeiture, foreclosure, and sale from about six years to three years. Repeals 20 sections of the General Property Tax Act on December 31, 2001, and an additional 37 sections on December 31, 2004. Reforms the tax reversion process and makes optional the foreclosing governmental unit's responsibility for administration of the process.
	PA 132:	Creates the Certification of Abandoned Property for Accelerated Forfeiture Act to provide for certification of abandoned tax delinquent property if local unit makes declaration. Establishes criteria for abandoned property, notice to property owners or taxpayer of record, and allows owner or person with legal interest to file an affidavit claiming property is not abandoned.
	PA 133:	Amends General Property Tax Act by providing that for taxes levied after December 31, 1998, certified abandoned property is subject to forfeiture, foreclosure, and sale for the enforcement and collection of the delinquent taxes. Allows owners of foreclosed property to recover monetary damages and specifies the requirements for property to be considered abandoned.
	PA 134:	Creates the Tax Reverted Property Emergency Disposal Act allowing a local governmental unit to obtain clear title to tax reverted property vested to the local unit prior to January 1, 2000, if a declaration of emergency backlog is made.
2000	PA 260:	Provides that the assessment for agricultural property being transferred between owners will remain capped if the new owner keeps the property in agricultural use for at least seven years from the date of transfer. If the property ceases to be agricultural property within the seven-year period, the property's assessment will be adjusted to reflect the property's state equalized valuation.
	PA 309:	Exempts from the tax real and personal property owned by a nonprofit charitable institution that was occupied and used by the institution’s chief executive officer, as his or her principal residence as a condition of employment. The property must be contiguous to real property that contains the nonprofit charitable institution’s principal place of business.
	PA 317:	Exempts heavy earth moving equipment from the tax, subject to both of the following requirements. First the equipment is to be sold within two years of first being leased or rented. Second, the lease or rental payments will count against the purchase price.
	PA 415:	Specifies that, for taxes levied after December 31, 2002, buildings and improvements located upon leased real property would be taxed as real property if the value of the buildings or improvements was not included in the assessment of real property. The bill also specifies that a building on leased land would bear the same classification as the parcel on which it was located.
2001	PA 94:	Technical remedy to problems encountered in implementing and administering the new tax reversion process established in Public Act 123 of 1999.
	PA 95:	Technical remedy to problems encountered in implementing and administering the new tax reversion process established in Public Act 123 of 1999.
	PA 96:	Technical remedy to problems encountered in implementing and administering the new tax reversion process established in Public Act 123 of 1999.
	PA 97:	Technical remedy to problems encountered in implementing and administering the new tax reversion process established in Public Act 123 of 1999.
	PA 98:	Technical remedy to problems encountered in implementing and administering the new tax reversion process established in Public Act 123 of 1999.
	PA 99:	Technical remedy to problems encountered in implementing and administering the new tax reversion process established in Public Act 123 of 1999.
	PA 100:	Technical remedy to problems encountered in implementing and administering the new tax reversion process established in Public Act 123 of 1999.
	PA 101:	Technical remedy to problems encountered in implementing and administering the new tax reversion process established in Public Act 123 of 1999.
2002	PA 549:	Exempt "alternative energy personal property" from the collection of personal property taxes for taxes levied after December 31, 2002 and before January 1, 2013.
	PA 624:	Allows a homeowner to claim a homestead property tax exemption for up to three previous years and to claim a rebate for overpayment of taxes for those years and for the year in which the appeal was filed.
	PA 744:	Provide that in determining the true cash value of personal property owned by an electric utility cooperative, the assessor has to consider the number of kilowatt hours of electricity sold per mile of distribution line compared to the average number of kilowatt hours sold per mile of distribution line for all electric utilities.
2003	PA 126, 127, 128, 129, 130, 140, 141:	Amend various acts to replace the term "homestead" with the term "principal residence."
	PA 105:	Provides for audits of homestead exemptions claimed by taxpayers to reduce the incidence of exemptions incorrectly claimed or allowed.
	PA 114:	Permits a person to disclose tax information if the disclosure is necessary for the proper administration of the General Property Tax Act.
	PA 247:	Retains May 1 as the deadline for filing an affidavit claiming a homestead exemption for school operating taxes.
	PA 274:	Replaces the definition of "special tools", and defines "standard tool", for the purpose of a personal property tax exemption.
2004	PA 4:	Amends the definition of "standard tools."
2005	PA 114:	Increases the maximum household income of a taxpayer who is eligible to defer the collection of summer property taxes from $35,000 in 2005, to $37,500 in 2006, and to $40,000 in 2007 and beyond.
	PA 165:	Exempts owner of residential rental property located in a renaissance zone from having to file an affidavit that the property is in compliance with applicable State and local laws if the property was in compliance in December of the immediately preceding tax year.
2006	PA 114:	Allows a totally and permanently disabled sole beneficiary of a trust to receive a principal residence or qualified agricultural exemption.
	PA 143:	Allows townships to appoint two alternate members to the Board of Review.
	PA 214:	Includes farming operations that harvest cervidae on-site in the definition of "agricultural operations" and makes such property eligible for the qualified agricultural property exemption.
	PA 278:	Includes game bird hunting preserve in the definition of "agricultural operations" and makes such property eligible for the qualified agricultural property exemption.
	PA 326:	Exempts federally-qualified health centers from real and personal property taxes effective with taxes levied in December 2004.
	PA 376:	Includes raising, breeding, training, leasing and boarding horse in the definition of "agricultural operations" and makes such property eligible for the qualified agricultural property exemption.
	PA 378: & PA 380:	Exempts a limited amount of qualified forest property from local school operating taxes. Allows the transfer of qualified forest property from one owner to another owner without the property being reassessed, contingent upon the property remaining as qualified forest property.
	PA 550:	Exempts from the tax biomass gasification systems, thermal depolymerization systems, and methane digesters.
	PA 612:	Allows local units of government to exempt certain nonprofit-owned single family dwellings from the tax for a maximum of two years.
	PA 624:	Requires that in each city or township where the State Treasurer collected the State Education Tax in the summer of 2005, the city or township will have to collect the Tax beginning in the summer of 2006.
	PA 633:	Includes "wind energy system" in the definition of personal property, thereby making such a system eligible for an alternative energy tax exemption.
	PA 664:	Provides a formula for calculating the portion of the taxable value of a bed and breakfast that is eligible for the principal residence exemption.
	PA 681:	Exempts property owned and occupied by certain nonprofit nursing homes and adult foster care facilities.
2007	PA 37:	Amends the Revised School Code (Public Act 451 of 1976) to exempt industrial personal property from local school operating taxes (18 mills) and to exempt commercial personal property from 12 mills of the local school operating taxes.
	PA 40:	Incorporates the personal property tax exemptions contained in Public Acts 37, 38, and 39 into the General Property Tax Act.
	PA 115 and 116:	Extends the exemption applied to new personal property, when the property is sold or leased by one eligible business to another eligible business.
2008	PA 96:	Allows homeowners to claim a second principal residence exemption, for up to three years, if a property is unoccupied.
Ad Valorem Special Assessments
1998	PA 542:	Amends the Township and Village Public Improvement and Public Service Act to provide that after 1998 ad valorem special assessments levied under the act must be levied on the taxable value of the property assessed. If the levy of an ad valorem special assessment on the property's taxable value is found to be invalid by a court of competent jurisdiction, the levy of the ad valorem special assessment must be levied on the property's state equalized value.
	PA 543:	Amends the General Property Tax Act to provide that after 1998, ad valorem special assessments must be levied on the taxable value of the property assessed, rather than the state equalized value.
	PA 544:	Amends the Township Public Improvement Act to provide that after 1998, ad valorem special assessments levied under the act must be levied on the taxable value of the property assessed. If the levy of an ad valorem special assessment on the property's taxable value is found to be invalid by a court of competent jurisdiction, the levy of the ad valorem special assessment must be levied on the property's state equalized value.
	PA 545:	Amends the Police and Fire Protection Act to provide for police and fire protection and to levy special assessments to pay for the equipment, to provide that after 1998, ad valorem special assessments levied under the act must be levied on the taxable value of the property assessed. If the levy of an ad valorem special assessment on the property's taxable value is found to be invalid by a court of competent jurisdiction, the levy of the ad valorem special assessment must be levied on the property's state equalized value.
1999	PA 49:	Permits a city to establish one or more business improvement districts, issue bonds, notes, or other obligations to finance projects and levy special assessments to finance the obligations of the district(s).
2002	PA 501:	Provide that a special assessment of up to two mills may be collected at the same time and in the same manner as the July levy. Also provides that special assessments do not apply to lands and premises exempt from property taxes under the General Property Tax Act.
Industrial Facilities Taxes
1999	PA 140:	Eliminates the provision requiring the consent of a local unit losing employment where granting an exemption would transfer employment from one local unit to another.
2005	PA 118:	Expands the definition of "industrial property" to include the operation of a logistical optimization center, which is defined as a sorting and distribution center that supports an assembly center and its manufacturing process.
	PA 251:	Allows a specific industrial facilities exemption issued in Fenton, which expired after seven years in 2003, to be extended, effective December 30, 2005, for five years to accommodate a manufacturing operation that is being moved from Whitmore Lake.
2006	PA 22:	Allows a facility in Port Huron to be granted an industrial facilities exemption retroactively to October 2001.
	PA 483:	Modifies the definition of "qualified commercial activity" to include certain warehousing, distribution, logistics, and communication facilities.
2007	PA 12 and 13:	Modifies the definition of "industrial property" to include a "strategic response center" and a "motorsports entertainment complex".
	PA 39:	Exempts industrial personal property from that portion of the tax attributable to the 6-mill State Education Tax and the 18-mill local school operating tax.
	PA 146:	Provides exceptions to the procedural requirements for approving a certificate for two specific projects, and reinstating a certificate for one project.
Commercial Forest Tax
2006	PA 381:, PA 382:, PA 383:	Creates a separate tax rate, equal to 15 cents per acre less than the standard tax rate for commercial forestland, for land that is subject to a sustainable forest conservation easement. Increases the tax on commercial forestland from $1.10 per acre to $1.20 per acre beginning January 1, 2007, until December 31, 2011, and by five cents per acre on January 1, 2012 and every five years after. Establishes a minimum size of 40 contiguous acres to be considered commercial forestland.
Private Forest Tax
2006	PA 378:	Repeals the tax effective September 1, 2007.
Neighborhood Enterprise Zone Facility Tax
2001	PA 140:	Amends the Act to permit qualification for 10 homeowners in the Morningside Commons development in Detroit to receive property tax reductions. This issue arose because application for the tax abatement certificate was made before the building permit was issued, creating what was described as a "paperwork mishap".
	PA 158	Changes the effective date of neighborhood enterprise zone certificates. The effect of the act is to provide reduced taxes upon the completion of new construction, and retain the prior tax payments for rehabilitated property.
2005	PA 338 PA 339 PA 340:	Allows the tax to be collected, in lieu of general property taxes, for up to 15 years as opposed to 12 years. Also, allows existing exemptions to be extended for up to 3 additional years. Adds a new category called "homestead facility" exempt from the general property tax and eligible for the alternative tax.
	PA 349:	Allows a facility in the city of Ecorse to obtain the tax abatement despite the fact that it obtained a building permit before it applied for the abatement.
	PA 661:	Increases the share, from 10% to 15%, of a local unit's total acreage that can be composed of a neighborhood enterprise zone containing only homestead facilities.
2008	PA 4:	Allows a facility in the city of Wyandotte to obtain the tax abatement despite the fact that it obtained a building permit before it applied for the abatement.
Commercial Rehabiliation Tax
2005	PA 210:	Allows a city, village or township to create a commercial rehabilitation district; allows an owner of a "qualified facility" to apply for a tax abatement; exempts a "qualified facility" from property taxes; provides for the levy of a Commercial Rehabilitation Tax on the "qualified facility"; and prohibits new exemptions from being granted after December 31, 2015.
2006	PA 554:	Extends the tax to multi-family residential property located in a commercial rehabilitation district, reduces the minimum size of a district from 75 acres to 3 acres, deletes the size and vacancy requirement for a qualified facility, and includes facilities that are allocated a new markets credit by the Internal Revenue Code.
2008	PA 3:	Eliminates the requirement that the property being rehabilitated is "obsolete".
Obsolete Properties Tax
2006	PA 70:	Modifies the definition of "rehabilitation" to include adding additional stories to a facility or adding additional space to an existing level.
	PA 667:	Allows facilities in the cities of Bay City and Adrian to be eligible for the tax abatement retroactively.
Low Grade Iron Ore Specific Tax
2002	PA 443:	Reduces for the 5-year period December 31, 2001 through December 31, 2006, the multiplier used to calculate the tax from 1.1% to .75%.

Last Updated July 22, 2008